Post Office Monthly Income Scheme (POMIS) 2026: 7.4% Interest Rate, Calculator & Complete Guide

If you want a completely safe way to earn fixed monthly income without worrying about market ups and downs, the Post Office Monthly Income Scheme (POMIS) remains one of the most trusted options in India.

POMIS is one of India’s oldest and most dependable small savings instruments. It pays a fixed monthly interest on your deposit for five years, backed by the Government of India. No NAV risk. No credit risk. No fine print surprises buried in a 40-page insurance document.

For retirees and middle-class families in places like Punjab, this scheme has long been a go-to for predictable cash flow. The current POMIS interest rate for 2026 stands at 7.4% per annum, unchanged from the previous quarter. On a maximum individual deposit of ₹9 lakh, that’s ₹5,550 per month — every month, for five years.

If you’re searching for “post office monthly income scheme”, you’re likely looking for the same thing: a zero-risk, fixed monthly payout backed by a sovereign guarantee.

This guide gives you:
✅ Current POMIS interest rate (7.4% for April-June 2026)
✅ How to calculate your exact monthly payout (with formula)
✅ Step-by-step account opening process (online + offline)
✅ Premature withdrawal penalties (and how to avoid them)
✅ POMIS vs. LIC monthly income plans (which is better?)

What Is the Post Office Monthly Income Scheme?

POMIS is a 5-year fixed-income scheme offered by India Post, designed to provide monthly interest payouts to investors. It’s 100% risk-free (backed by the Government of India) and ideal for:

• Retirees seeking steady income
• Conservative investors who avoid market risks
• Middle-class earners looking for guaranteed returns

The Post Office Monthly Income Scheme (POMIS) offers 7.4% per annum interest in 2026. On a maximum individual deposit of ₹9 lakh, you receive ₹5,550 per month for five years. Joint accounts allow up to ₹15 lakh, paying ₹9,250 monthly. The principal is fully returned at maturity. Interest is taxable as per your income slab.

Key Features (2026): Post Office Monthly Income Scheme

Feature	Details
Interest Rate	7.4% p.a. (April-June 2026)
Tenure	5 years (lock-in)
Minimum Deposit	₹1,000
Maximum Deposit (Individual)	₹9 lakh
Maximum Deposit (Joint Account)	₹15 lakh
Monthly Payout	Interest credited on the 1st of every month
Tax Benefit	No tax exemption (interest is taxable)
Premature Withdrawal	Allowed after 1 year (with penalty)

You deposit a lump-sum amount once and receive interest every month for the next five years. At maturity you get your full principal back.

The scheme carries sovereign guarantee, which means zero credit risk. Interest is paid out directly into your linked savings account or handed over as cash, depending on the post office.

Current POMIS Interest Rate in 2026 and How Much You Earn

As of April–June 2026 the interest rate stands at 7.4% per annum, paid monthly. The rate has stayed unchanged for several quarters and is reviewed every three months by the Ministry of Finance.

Monthly income formula (simple and exact): Monthly payout = (Principal × 7.4) ÷ 1,200

Here are real examples for the most common deposit amounts:

Deposit Amount	Annual Interest	Monthly Income
₹1,50,000	₹11,100	₹925
₹3,00,000	₹22,200	₹1,850
₹5,00,000	₹37,000	₹3,083
₹9,00,000 (max single)	₹66,600	₹5,550
₹15,00,000 (max joint)	₹1,11,000	₹9,250

These figures come straight from the official 7.4% rate. The interest is calculated on the original principal every month and does not compound inside the account.

Pro Tip:
Use the POMIS Calculator to estimate your exact payout.

How to Open a POMIS Account: Step-by-Step

You can open a POMIS account at any Head Post Office or Sub Post Office across India. Online opening is also possible through the India Post Payments Bank (IPPB) mobile app if you already have a savings account linked.

Option 1: Online Application (Fastest Method)

1. Visit India Post eBanking or UMANG App.
2. Log in (or register if you don’t have an account).
3. Select “Post Office Monthly Income Scheme (POMIS)”.
4. Fill in details (name, PAN, Aadhaar, nominee).
5. Upload documents (PAN, Aadhaar, passport-size photo).
6. Make payment (via net banking/UPI).
7. Receive confirmation (account opened instantly).

Option 2: Offline Application (At Post Office)

1. Visit your nearest post office with:
   • PAN Card (mandatory)
   • Aadhaar Card (for KYC)
   • Passport-size photos (2)
   • Cheque/DD (for deposit)
2. Fill Form-1 (POMIS application form).
3. Submit documents & deposit amount.
4. Receive passbook (account activated in 1-2 days).

Monthly interest is credited directly to your linked post office savings account. You can then withdraw it, transfer it, or let it accumulate — the choice is yours.

Eligibility, Account Limits and Types

• Who can open: Indian residents above 18 years (or a guardian for minors above 10). Joint accounts can have up to three adults.
• Minimum deposit: ₹1,500
• Maximum deposit: ₹9 lakh (single account) / ₹15 lakh (joint account)
• Tenure: 5 years (non-renewable in the same account; you can reinvest the principal elsewhere at maturity)

Nomination is mandatory at opening and can cover up to four nominees.

Documents Required to Open a POMIS Account (2026)

To comply with current Know Your Customer (KYC) regulations, you must physically present the original documents for verification at the post office counter alongside self-attested photocopies.

• Duly Filled Application Form: You can obtain this at the branch or download the latest POMIS account opening form directly from the India Post web portal.
• Primary Financial Identity (Mandatory): Your Permanent Account Number (PAN) Card. (If you do not possess a PAN card, Form 60 must be submitted, and the PAN must be provided within six months).
• Address & Identity Proof: Your Aadhaar Card is the standard requirement. If unavailable, you may substitute it with a valid Passport, Voter ID, or Driving License.
• Photographs: Two to three recent passport-sized color photographs.
• Post Office Savings Account Passbook: A standard post office savings account is mandatory to route the monthly interest payouts. If you already have one, bring the passbook to link the accounts.

Can You Withdraw from POMIS Before Maturity? Rules and Penalty Math

POMIS has a 5-year lock-in, but you can withdraw early after 1 year—with penalties.

Withdrawal After	Penalty
1 to 3 years	2% deduction from principal
3 to 5 years	1% deduction from principal
After 5 years	No penalty (full amount refunded)

Real Example:
If you withdraw ₹5 lakh after 2 years, you’ll get:
₹5,00,000 – (2% of ₹5,00,000) = ₹4,90,000

Exceptions (No Penalty):
✔ Death of account holder (nominee gets full amount)
✔ Medical emergencies (with valid proof)

We have seen many families underestimate this penalty when liquidity needs arise, so plan the five-year horizon carefully.

POMIS vs. LIC Monthly Income Plans (Which is Better?)

Many investors compare POMIS with LIC’s fixed income plans (specifically LIC Jeevan Akshay or LIC’s annuity products) when seeking monthly payouts. Here’s how they stack up:

Parameter	POMIS (Post Office)	LIC Jeevan Shanti (typical annuity)
Interest / Payout	Fixed 7.4% monthly	Age-dependent annuity rate (usually 6–8% effective)
Minimum investment	₹1,500	₹1.5 lakh
Maximum investment	₹9L single / ₹15L joint	No upper limit
Principal returned	Yes, full at maturity	Usually not (pure annuity) or optional
Tax benefit on deposit	None	Premium qualifies under 80C
Risk	Sovereign guarantee	Insurance company backed
Liquidity	Penalty after 1 year	Surrender charges apply
Monthly income starts	Immediately	Can be deferred

The key difference: LIC annuity products are designed for lifetime income — once you buy, your capital is typically gone (converted to income stream). POMIS returns your capital after 5 years, giving you flexibility to reinvest, redirect, or close the loop.

Verdict:

• Choose POMIS if you want higher returns, shorter tenure, and zero risk.
• Choose LIC if you need tax benefits and longer-term security.

POMIS Tax Treatment: What Section 80C Does (and Doesn’t) Cover

This is the most common misconception about POMIS.

POMIS does NOT qualify for Section 80C deduction. The deposit amount cannot be claimed as a deduction from your taxable income.

The interest earned, however, is taxable under “Income from Other Sources” at your applicable income tax slab rate. There is no TDS deducted by the post office on POMIS interest — but that does not mean the income is tax-free. You must declare it in your ITR each year.

For retirees whose total income falls below the basic exemption limit (₹3 lakh for seniors under new regime, ₹3.5 lakh for very senior citizens), the POMIS interest will effectively be tax-free — not by design, but because their overall income doesn’t cross the taxable threshold.

For higher-income individuals in the 30% slab, the effective post-tax yield at 7.4% drops to approximately 5.18%. At that point, tax-efficient alternatives like SCSS (Senior Citizen Savings Scheme) — which offers 8.2% and qualifies under 80C — may offer better net returns.

Best Alternatives to POMIS (If You Want Higher Returns)

If you’re open to slightly higher risk for better returns, consider:

1. Senior Citizen Savings Scheme (SCSS)
   • Interest Rate: 8.2% (2026)
   • Tenure: 5 years
   • Tax Benefit: Yes (under Section 80C)
   • Best For: Retirees (60+ years)
2. Pradhan Mantri Vaya Vandana Yojana (PMVVY)
   • Interest Rate: 7.4% (2026)
   • Tenure: 10 years
   • Tax Benefit: No
   • Best For: Senior citizens (60+)
3. Corporate Fixed Deposits (Bajaj Finance, HDFC, etc.)
   • Interest Rate: 7.5%–8.5%
   • Tenure: 1–5 years
   • Risk: Moderate (not government-backed)
   • Best For: Investors willing to take slightly higher risk

Should You Choose POMIS in 2026? Pros and Cons of POMIS

POMIS makes the most sense if:

• You have a lump sum of ₹3 lakh or more earning less than 7.4% elsewhere
• You need predictable monthly cash flow (pension supplement, household expenses)
• You are in a lower income tax bracket where the taxable interest is less of a concern
• You want zero credit risk with full principal protection

It makes less sense if:

• You are in the 30% tax bracket — the post-tax yield shrinks considerably
• You are above 60 — SCSS at 8.2% is simply better
• You need liquidity within 1–2 years — the premature withdrawal rules are punishing

Pros of POMIS

• Zero risk, government guarantee
• Predictable monthly cash flow
• Simple paperwork
• Easy to open anywhere in India

Cons of POMIS

• Interest fully taxable
• Five-year lock-in with early-exit penalty
• Maximum limits cap total income
• Rate can change every quarter (though it has been stable)

Conclusion

The Post Office Monthly Income Scheme (POMIS) is one of the safest ways to earn a fixed monthly income in India. With a 7.4% interest rate (2026), ₹9 lakh individual limit, and government backing, it’s ideal for retirees and conservative investors.

Next Steps:

1. Calculate your monthly payout using the POMIS Calculator.
2. Compare with SCSS/PMVVY if you’re a senior citizen.
3. Open an account online via India Post eBanking.

For the latest small-savings rates and more retirement-income guides, bookmark TechGuruShiksha.in.

FAQs

Have a question about whether POMIS fits your current financial situation — or want us to run the numbers for a specific deposit amount? Leave a comment below and we’ll respond.

For more data-backed breakdowns of small savings schemes, fixed income instruments, and zero-risk investing strategies for the Indian market, subscribe to the TechGuruShiksha newsletter.